The Nigerian secondary bond market concluded the week on a strong positive note, with average benchmark yields declining to 15.57 percent as investor appetite for government securities intensified across various maturity periods.
Bullish Momentum in Fixed-Income Markets
Trading activity throughout the week demonstrated significant vigor, highlighting renewed confidence in fixed-income instruments during ongoing uncertainties in equities and higher-risk investment categories. The 20 basis points decrease in yields signals a broad movement toward safer assets as market participants seek stability amid fluctuating conditions.
Financial experts attribute this strengthened demand to encouraging fiscal indicators from the federal government and consistent monetary policy implementation. These factors have collectively fostered a more attractive landscape for fixed-income investments. Market players are increasingly attracted to the comparative value presented by Nigerian sovereign bonds against other domestic and regional financial instruments.
Eurobond Performance Mirrors Domestic Trend
The optimistic sentiment extended to the external debt arena, where Nigeria's sovereign Eurobonds maintained their positive trajectory. Average Eurobond yields decreased by 21 basis points to 7.77 percent week-on-week, indicating restored investor trust in Nigeria's external debt obligations.
This yield reduction demonstrates growing investor readiness to accept lower returns in exchange for perceived stability and safer exposure to Nigerian sovereign risk. The pattern finds additional support in relatively calm global fixed-income conditions, which continue to promote capital flows into emerging-market debt instruments.
Analysts from Cowry Asset Management maintain a largely positive outlook for both local bond and Eurobond markets. They project that continued investor engagement, improving macroeconomic signals, and gradual fiscal consolidation will maintain yields on a consistent downward path. The approaching maturity of the November 2025 Eurobond is expected to generate additional interest, potentially driving yields even lower as demand escalates.
Currency and External Reserves Update
Meanwhile, the naira experienced depreciation, weakening to N1,442.43 against the US dollar in the official market and N1,472 on the parallel market. This extends a week of renewed pressure despite ongoing intervention efforts by the Central Bank of Nigeria.
The currency registered a 0.41 percent decline at the official window and a more substantial 1.49 percent drop in the parallel market, highlighting persistent demand pressures and structural challenges that continue to influence Nigeria's foreign exchange landscape.
Despite the naira's struggles, Nigeria's external reserves provided some缓冲, increasing to $43.43 billion from $43.35 billion, representing a 0.18 percent week-on-week growth. This accumulation was bolstered by consistent crude oil revenues, enhanced non-oil inflows, and a resilient trade surplus—factors that have strengthened the CBN's capacity to intervene in markets and moderate excessive volatility.
Global Oil Market Developments
On the international front, oil prices strengthened as geopolitical tensions intensified. Renewed Ukrainian drone assaults on Russia's strategic Novorossiysk export facility fueled concerns about potential supply disruptions, pushing WTI crude upward by 2.71 percent to $60.28 per barrel, while Brent crude advanced to $64.54 per barrel.
The recent attacks emphasize Ukraine's heightened focus on Russian refinery infrastructure, with analysts cautioning that upcoming U.S. sanctions on Rosneft and Lukoil scheduled for November 21 could amplify supply risks and introduce fresh uncertainty into oil markets.
Looking forward, the naira is anticipated to trade with greater stability, supported by stronger external reserves, consistent foreign exchange inflows, and improved market structure organization. Market sentiment remains bolstered by Nigeria's recent Eurobond issuance, which has alleviated supply concerns and helped establish expectations for a narrower trading range in the short term. Enhanced market liquidity is also likely to provide additional support for the local currency.
Globally, a risk-averse sentiment has increased demand for traditional safe-haven currencies like the Japanese yen and Swiss franc, applying pressure to the U.S. dollar.
For investors, the evolving financial landscape underscores the strategic significance of Nigerian fixed-income assets as reliable anchors within diversified portfolios, especially for those seeking protection from turbulence observed in riskier asset classes.
